this report provides an in-depth analysis of the criteria for unfair dismissal and justifiable reasons for dismissal, based on Articles 23 and 24 of the Labor Standards Act. it details key legal information that both workers and employers should be familiar with, from the differences between ordinary dismissal, disciplinary dismissal, and redundancy, to how to calculate notice pay, the process for applying for relief from the Labor Commission, and the period when dismissal is absolutely prohibited.

legal definition and social implications of dismissal under the Labor Standards Act

in the Korean labor law system, dismissal is a unilateral termination of employment by an employer, regardless of the employee's will. it is located at the point where two values collide: the exercise of management rights guaranteed by the Constitution and the protection of workers' right to survival. article 23(1) of the Labor Standards Act strictly limits an employer's right to dismiss an employee by stipulating that an employer may not dismiss, leave, suspend, transfer, reduce pay, or otherwise punish an employee without just cause. legally, just cause, a key criterion for determining the legitimacy of dismissal, means that there is a reason for which the employee is responsible, or that there is an urgent management need, such that the employment contract cannot be continued according to social norms. the burden of proof for such justification rests solely with the employer, and if the employer fails to do so, the dismissal will lose legal effect and be considered unfair.

classification of types of dismissals and analysis of justification

there are three main types of dismissals, depending on the cause and purpose. they are: ordinary dismissal based on personal reasons, disciplinary dismissal as punishment for misconduct, and dismissal for business reasons (layoffs) to overcome a business crisis. the criteria for determining the justification required by the court for each type of dismissal are different, and clarifying the distinction is the starting point for resolving disputes.

ordinary dismissal for personal reasons

ordinary dismissal occurs when an employee lacks the mental or physical fitness required to fulfill his or her contractual obligation to provide labor, and the employer can no longer expect the employee to provide normal labor. unlike a disciplinary dismissal, it is of a default nature and does not necessarily require intent or negligence on the part of the employee.

main reasons for ordinary dismissal specific criteria and examples case law physical disability and illness injury or illness that prevents the employee from performing his or her duties and makes it difficult to place the employee in a suitable job

대판 95다45934

lack of ability to perform the job the employee's performance is significantly low and there is no room for improvement even after training or reassignment

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lack of qualifications and qualifications contractual prerequisites such as loss of required qualifications, driver's license revocation, etc

case No. 96NU15728

criminal penalties and offenses when a serious work-related offense makes it impossible to maintain the employment contract

in order for an ordinary dismissal to be justified, it is not enough for the reason to be listed in the employment rules; it must be proven that there are objective reasons that make it impossible to continue the employment relationship in good faith. in particular, in the case of illness, if there is a possibility of recovery within a reasonable period of time, consideration should be given to a leave of absence rather than dismissal.

disciplinary dismissal to maintain corporate order

disciplinary dismissal is the most severe punishment an employer can impose on an employee for behavior that disrupts workplace discipline or workplace order. in order for a disciplinary dismissal to be valid, it must meet three requirements: just cause, adequacy of remedy, and fairness of procedure.

in terms of the legitimacy of the reason, the court will first look to see if the employee falls within the disciplinary grounds set out in the employment rules or collective agreement. typical examples include absenteeism, falsifying a resume, embezzlement, workplace bullying or sexual harassment, and inciting unlawful labor disputes. in the case of resume misrepresentation, in particular, the misrepresentation must be so serious that the employer would not have hired the employee had it been known.

the appropriateness of the remedy is whether the dismissal is not too harsh in relation to the severity of the employee's misconduct. the court will consider the motivation for the misconduct, the employee's usual attendance, and the employee's history of punishment. procedural justification means that the procedures stipulated in the collective agreement or employment rules must be followed, such as holding a disciplinary committee and providing an opportunity to be heard. disciplinary dismissals with significant procedural flaws are very likely to be declared invalid, even if they are justified.

strict requirements for dismissal for managerial reasons

since dismissal for managerial reasons, also known as layoffs, is a dismissal based on the employer's managerial judgment, even if the employee has done nothing wrong, Article 24 of the Labor Standards Act sets out four strict requirements for such dismissals.

1. urgent business necessity: This includes reducing the workforce to avoid bankruptcy as well as to deal with possible future crises, but it must be proven by objective indicators. layoffs that are simply to increase profits or for managerial convenience are not acceptable.

2. active Efforts to Avoid Layoffs: The employer must try all means to preserve employment, including rationalization of business policies, suspension of new hiring, furloughs, and use of voluntary retirement, before layoffs are made.

3. reasonable and fair selection: Objective and reasonable criteria must be used to select employees for termination, and there must be no discrimination between men and women. case law favors criteria that take into account seniority, work performance, and the presence of dependents.

4. consultation with worker representatives: Worker representatives must be notified and consulted in good faith at least 50 days before the proposed termination date.

if any of the above four requirements are lacking, the layoff will be unfair. however, recent Supreme Court precedents have tended to consider these requirements collectively, rather than separately, depending on the specific circumstances.

procedural justification and notice system

the Labor Standards Act considers the process of dismissal as important as the reason for dismissal. because a sudden dismissal can disrupt a worker's livelihood in an instant, the law requires notice and written notification.

practical application of notice and severance pay

employers are required to give at least 30 days' notice to terminate an employee, and if they fail to do so, they must pay at least 30 days' regular wages as severance pay. this rule applies to workplaces with fewer than five employees at any given time, without exception.

the calculation method of severance pay differs depending on the type of employment.

type of work calculation formula and criteria example situation regular workers hourly wage × 1 day × 30 hours × 30 days

approximately KRW 3.4 million based on a monthly salary of KRW 3 million (209 hours)

short-time workers (4 weeks of prescribed working hours / 4 weeks of regular worker working days) × regular wage × 30 days

calculated based on 4 hours per day for a 20-hour workweek

since the pre-termination allowance is compensatory for procedural violations, regardless of whether the dismissal was justified or not, the employer cannot return the allowance even if the employee is later determined to have been unfairly dismissed and reinstated. however, the notice obligation is exempted in cases where the period of continuous employment is less than three months, the business cannot continue due to a natural disaster, or the employee has intentionally caused significant disruption to the business.

obligation to give written notice of dismissal

according to Article 27 of the Labor Standards Act, all dismissals are effective only after written notice of the reason for dismissal and the time of dismissal. this is to ensure that the employee is clearly informed of the reason for the dismissal and can react to it. oral dismissals are invalid, even for good cause, and while case law has upheld the validity of text messages and emails, it's generally safer to have something in writing on paper.

when and why dismissal is legally prohibited

south Korean law categorically prohibits dismissing employees when they are at their most vulnerable, or when they are exercising legitimate socially protected rights.

legal theory of the absolute prohibition period

article 23(2) of the Labor Standards Act prohibits dismissal, even for just cause, during the following periods

• during and 30 days after a leave of absence for treatment of an occupational injury or illness.

• during and 30 days after a woman's leave of absence in accordance with the law for pre- and post-natal periods.

• workers during parental leave.

not only are terminations during these periods generally invalid, but employers who violate them face very severe criminal penalties of up to five years in prison or a fine of up to KRW 50 million. however, exceptions may be granted in extreme circumstances where the business cannot continue, or when temporary compensation is provided as prescribed by law.

prohibition of discriminatory and retaliatory dismissal

dismissal for exercising certain attributes or rights is also strictly prohibited.

prohibited grounds laws and highlights remarks gender and family status prohibits discrimination on the basis of sex and dismissal for reasons such as reduced hours during parental leave

equal Employment Opportunity Act

labor Union Activities dismissal for union membership, legitimate union activities, reporting unfair labor practices, etc

labor Union Act

social Status and Physical prohibition of dismissal without reasonable grounds due to disability, age (senior citizens), etc

employment of the Elderly Act, etc

reporting violations of laws and regulations prohibition of retaliatory dismissal for reporting violations of labor standards laws, allegations of sexual harassment, etc

labor Standards Act, etc

employment type discrimination prohibiting termination of fixed-term and temporary workers for filing a discrimination complaint

fixed-term employment laws, etc

these prohibitions are designed to ensure workers' fundamental rights, and violations can result in not only an unfair dismissal order but also liability for damages.

the unfair dismissal remedy process through the Labor Commission

when an employee is wrongfully terminated, the most efficient alternative to a costly and time-consuming civil lawsuit is to file a claim with the Labor Commission.

golden Time to File: The 90-Day Rule

you have 90 days from the date of termination to file a claim with the local labor board. it is important to note that if you miss this period, you will not be able to obtain administrative relief, even if the dismissal was clearly unfair. you can apply online (government24) as well as in person.

the Hearing Process and the Effect of the Decision

once an application for relief has been filed, the Labor Commission will go through an investigation phase in which an investigator will gather arguments and evidence from the parties. a hearing is then held by a tribunal composed of public members to determine the legitimacy of the dismissal.

if the tribunal finds that the dismissal was unfair, the labor commission will order the employer to reinstate the employee or, if the employee wishes, to pay monetary compensation. it will also order the employer to pay the employee the equivalent of the wages he or she would have received if he or she had been working normally during the period of dismissal. if you disagree with the decision of the local labor board, you have 10 days from the date of receipt of the decision to request a review by the Central Labor Board.

securing the benefits and effectiveness of remedies

in recent years, the monetary compensation system has been revitalized, allowing workers to challenge the unfairness of their dismissal even if they do not want to be reinstated. if an employer fails to comply with the Labor Commission's finalized remedy order, the Labor Commission will repeatedly impose a compulsory fine of up to 30 million won to pressure the employer to comply with the order.

real-life examples and implications of unfair dismissal disputes

the success stories of law firms and labor firms show that the key to unfair dismissal disputes is objective evidence and procedural rigor.

in a case where a department head who had worked for a corporation for 20 years was abruptly dismissed, the Labor Commission found that the disciplinary reasons cited by the employer were not serious enough to maintain the employment relationship according to social norms, and ordered reinstatement and payment of wages. in addition, in the case of fixed-term employees, even if the termination is due to the expiration of the contract period, if the employee is recognized as having a legitimate expectation of contract renewal, there must be a reasonable reason for refusing to renew the contract to avoid unfair dismissal.

on the other hand, in a case we handled on behalf of an employer, we were able to prove that an employee had caused multiple workplace problems at a small business after only five months on the job, and induce the Labor Commission to recommend settlement, which minimized the actual losses. this suggests that unfair dismissal disputes are not just about winning or losing, but about strategic negotiation between labor and management.

frequently asked questions about unfair dismissal

Q1. Can it be unfair dismissal if the company is reducing staff due to business difficulties?

A1. Yes, even if there are business difficulties, it may be determined to be unfair dismissal if efforts to avoid dismissal were not made (leave of absence, reassignment, etc.) or if the criteria for selecting employees were unfair.

Q2. Is it true that workplaces with fewer than 5 employees are free to terminate employees?

A2. Employers with fewer than 5 employees are not subject to the Labor Standards Act's requirement of justification for dismissal (Article 23(1)) or the provisions for applying for relief from the Labor Commission. However, they are required to give notice of dismissal (30 days' notice or payment of severance pay) and are exempt from the obligation to provide written notice, but it is best to do so to prevent disputes.

Q3. I received my termination notice by email, is it legally enforceable?

A3. Case law may recognize email as written notice if it clearly states the reason and timing of the termination and the employee has no difficulty verifying it. however, oral or text messages are generally not valid.

Q4. How long will it take for me to get a result if I apply for unfair dismissal relief?

A4. It usually takes about two months (60 days) from the time the application is received to the time of the investigation and hearing to issue a decision. in some cases, the case may be concluded earlier than one month through settlement.

Q5. Can I still receive unemployment benefits if I am laid off?

A5. Yes, a layoff is considered an involuntary separation from employment, so you may be eligible for unemployment benefits if you meet the basic requirements, including the length of your employment insurance coverage (180 days or more).

suggestions and recommendations from experts (CTA)

termination is the most painful decision and process for both the employee and the employer. before considering termination, employers should minimize the legal risks of wrongful termination by fully understanding the just cause and procedures required by law. in particular, it is essential to develop a disciplinary policy and establish objective evaluation metrics.

to protect their rights, employees should obtain the dismissal letter and relevant evidence as soon as they are notified of their termination and seek professional assistance within the short 90-day time limit for filing a claim. it's important to remember that a wrongful termination is not just an emotional response; it's a legal dispute that requires a strategic approach based on the law. we encourage you to contact us today for a free labor consultation to determine if your situation qualifies as wrongful termination and to pursue the compensation you deserve.